The USDCHF rallied sharply in today’s session, but the upside momentum stalled right at the lower bound of a key swing area between 0.8017 and 0.8023. This zone has repeatedly acted as both support and resistance going back to late June (see red numbered circles) and remains a major technical barrier to further gains.
Earlier at the start of the day, the pair found solid support at the 100-hour moving average (blue line) and successfully pushed above both the 200-hour moving average (green line) and a swing area resistance area (green numbered circles) between 0.7986 and 0.7994. This area now serves as close support going forward on a further dip lower..
If the price can break above the 0.8023 level, traders will look toward the next upside targets near 0.8054–0.8062, followed by the 38.2% retracement at 0.8102.
However, failure to hold above the 0.7986–0.7994 zone and the 200 hour MA at 0.7980 could open the door for a pullback toward 0.7947, where swing area and 100 hour moving average support converge.
This article was written by Greg Michalowski at investinglive.com.
